MICHAEL LEWIS: The 'Ray Rice Video' Of Wall Street Has Arrived

Author Michael Lewis. REUTERS/Lucas Jackson A former Federal Reserve employee has provided an unprecedented look inside the New York Fed through a series of audio recordings made in 2012 that suggest regulators may have been too soft on Goldman Sachs in the wake of the 2008 financial crisis.

The recordings "portray a New York Fed that is at times reluctant to push hard against Goldman [Sachs]," Bernstein writes.

Similarly, Lewis said: "Much of the meaning of the piece is in the tones of the voices — and, especially, in the breathtaking wussiness of the people at the Fed charged with regulating Goldman Sachs."

Segarra, an experienced lawyer, was brought in by the New York Fed after a 2009 commisioned report, written by Columbia Business School professor David Beim, found that many problems within the regulatory institution were related to a corrosive culture.

Columbia Business School professor David Beim, author of the Beim report. Colombia University

"[The report] was supposed to be completely confidential," Beim told "This American Life." He added: "As you can probably gather from the tone, it is totally candid and highly self-critical."

In particular, Beim identified something known as "regulatory capture," or the term for when a watchdog gets too "cozy" with the company that he or she is supposed to be regulating.

Bernstein offers an example:

One New York Fed employee, a supervisor, described his experience in terms of "regulatory capture," the phrase commonly used to describe a situation where banks co-opt regulators. Beim included the remark in a footnote. "Within three weeks on the job, I saw the capture set in," the manager stated.

Beim said that senior Fed officials wanted the footnote removed to avoid embarrassment, but it was left in.

During Segarra's time at Goldman, she witnessed the same issues called out by Beim. Segarra became so disillusioned with the firm that she began secretly taping discussions between bank regulators and Goldman employees. Segarra notes that in one meeting, she heard a senior executive at Goldman say, "Goldman's view was that once clients were wealthy enough, certain consumer laws didn't apply to them."

But, as ProPublica reported last October, Segarra was fired by the Fed after seven months on the job. This was after she had raised concerns about problems within the bank. She later filed a wrongful termination lawsuit. His case is now on appeal after the court ruled in favor of the New York Fed.

Once you have listened to it — as when you were faced with the newly unignorable truth of what actually happened to that NFL running back's fiancee in that elevator — consider the following:

1. You sort of knew that the regulators were more or less controlled by the banks. Now you know.

2. The only reason you know is that one woman, Carmen Segarra, has been brave enough to fight the system. She has paid a great price to inform us all of the obvious. She has lost her job, undermined her career, and will no doubt also endure a lifetime of lawsuits and slander.

In a statement, the New York Fed said that it "categorically rejects the allegations being made about the integrity of its supervision of financial institutions."

The firm writes: "To get a balanced view of [Segarra's] claims, you should read what the senior Federal Reserve supervisor with oversight responsibilities for GS wrote after discovering that what she had said about Goldman was just plain wrong."